Tories reject rivals' fear of carbon tariff

OTTAWA (Reuters) - Trade Minister Michael Fortier rejected
the notion on Thursday that some countries might slap tariffs
on Canadian products because of the Conservative government's
weak climate change policies.

Liberal leader Stephane Dion, campaigning for the October
14 general election, warned on Thursday that Canada could face
tariffs on its exports if it did not take tougher action to
combat climate change.

Dion's major campaign promise is to impose a tax on carbon
emissions to cut greenhouse gas output. He says he would offset
the carbon tax with income tax cuts and higher subsidies to the
poor. His plan would boost taxes on most fuels, with the
exception of gasoline.

"Other countries are considering slapping carbon tariffs on
those who don't take action on climate change. As hard as it is
to believe, for now, Canada is one of those countries," Dion
said in a speech in New Brunswick.

Under Dion's plan, in addition to taxing carbon a Liberal
government would try "where possible" to put a tariff on
imports from other countries that do not put a price on carbon.

Fortier told reporters that he had returned from
international trade ministerial talks where no one had given
any indication of applying tariffs on Canada or any other
countries.

"I think Mr. Dion is inventing a trade war," he said.

In January, the European Commission debated whether to push
for a carbon tariff, an idea first put forward by former French
President Jacques Chirac.

But the plan ran into opposition from European Trade
Commissioner Peter Mandelson, who has said it would be hard to
implement and could lead to trade disputes, and the European
Commission dropped the idea at least for now.
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